Canadian dollar steadies as oil surges for second straight day

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FILE PHOTO: A Canadian dollar coin, commonly known as the "Loonie", is pictured in this illustration picture taken in Toronto, January 23, 2015. REUTERS/Mark Blinch/File Photo

TORONTO (Reuters) - The Canadian dollar was little changed against its U.S. counterpart on Friday as oil prices rallied for a second straight day, while data showing a plunge in U.S. jobs added to evidence of the economic damage from the coronavirus pandemic.

At 9:09 a.m. (1309 GMT), the Canadian dollar CAD=D4 was trading nearly unchanged at 1.4138 to the greenback, or 70.73 U.S. cents. The currency, which was on track to decline 1% for the week, traded in a range of 1.4118 to 1.4223.

U.S. nonfarm payrolls plummeted by 701,000 in March, a much bigger-than-expected decline than had been expected. Canada sends about 75% of its exports to the United States, including oil.

U.S. crude oil futures CLc1 were up 8.5% at $27.48 a barrel on rising hopes of a new global deal to cut global crude supply.

The Canadian dollar is set to remain at depressed levels over the coming months, with analysts in a Reuters poll slashing their forecasts for the currency as the coronavirus pandemic potentially pushes Canada’s economy into a deep recession.

Ottawa is rolling out more than C$200 billion in support for Canada’s economy, including direct aid to Canadians, wage subsidies for businesses, loan programs and tax deferrals, while the Bank of Canada has slashed interest rates to nearly zero and launched a large-scale asset purchase program, quantitative easing, for the first time.

Canada’s biggest banks have received nearly half a million requests from homeowners to hold off mortgage payments as the economic fallout from the COVID-19 pandemic deepens, according to the Canadian Bankers’ Association.

Canadian government bond yields edged lower across the curve. The 10-year CA10YT=RR was down less than one basis point at 0.693%.